India Urges OPEC Nations To "Fill Supply Gap", Ensure Sustainable Prices

High oil prices hurting fiscal balance, says Pradhan

Oil prices drop after Iran signals it might agree to Saudi production increase

While India is not in favour of oil prices as low as $30 a barrel, the prevailing price levels are too high and stand to hurt the country's fiscal situation, Petroleum Minister Dharmendra Pradhan said on Wednesday.

But analysts said trade concerns and disagreements within the Organization of the Petroleum Exporting Countries (OPEC) over boosting supply continue to loom over the market.

"We hope that there will be an agreement", Iraqi Oil Minister Jabbar al-Luaibi told reporters.

De-facto OPEC leader and top crude exporter Saudi Arabia as well as Russian Federation which is not a member of the cartel but the world's biggest oil producer, are pushing for looser supply controls.

So far there is no indication that Iran and the other members would agree to such a reallocation, although with officials holding extensive talks in the run-up to Friday's Opec meeting, further compromise could be made.

"We expect from Opec and its members a commitment to step in (and) more than fill the gap to ensure sustainable prices", Indian oil minister Dharmendra Pradhan said at a seminar in Vienna. The proposal has yet to win the backing of all OPEC members, and may meet resistance from more hawkish countries in the group including Venezuela and Algeria as well as Iran.

When OPEC and its allies, which include Russia, Kazakhstan and Mexico, agreed to cut output in late 2016, they announced a 1.8 million-barrel-a-day reduction. Zanganeh has said the president is to blame for high prices because of his unilateral withdrawal from the worldwide nuclear agreement.

Crude oil prices are trading lower early Thursday, but inside yesterday's range.

More important to Saudi Arabia than extra petrodollars is containing Iran, its arch-nemesis.

Regional rival Iran however is fiercely opposed to unwinding the agreed production curbs, as its oil industry is bracing for fresh sanctions following US President Donald Trump's decision to quit the worldwide nuclear pact.

If the existing deal were retained and the Saudis felt a need to add more oil, Riyadh could increase output unilaterally, as it did after a meeting in June 2011 ended with no decision.

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